Wage and Hour Division (WHD)

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DES MOINES, Iowa -- Principal Financial Group, a Des Moines company, has paid $237,490 in back overtime wages to 53 salaried employees who were erroneously classified as exempt from the overtime requirements of the Fair Labor Standards Act (FLSA).

Principal Financial, which offers a wide range of financial products and services to clients worldwide, identified the misclassifications during a corporate-wide review to determine its status of compliance with the new FLSA Overtime Security regulations that became effective in August 2004.

The department’s Wage and Hour Division investigated the company’s pay practices covering a two-year period from Nov. 2, 2002 to Nov. 1, 2004. The investigation confirmed the results of Principal Financial’s internal review and supported the employer’s recent re-classification of various positions to comply with requirements of the new regulations. As a result of the company’s review, certain employees who had not been paid overtime are now eligible for overtime.

“Prompted by the department’s efforts to promote compliance with the new Overtime Security regulations, Principal Financial examined the exemption status of various employee positions,” said Percella Maupins, district director for the Wage and Hour Des Moines office. “The company’s internal audit identified some positions that were misclassified as exempt prior to the implementation of the new regulation. As a result, the company has now reclassified the employees and, most importantly, has gone back and properly compensated those workers.”

The FLSA requires employees to be paid the federal minimum wage for all hours worked and time and one-half the regular rate of pay for hours worked over 40 in a week unless the employee is exempt from overtime pay. Employers must also maintain accurate time and payroll records.

The Wage and Hour Division recovered nearly $200 million in back wages in fiscal year (FY) 2004 for more than 288,000 workers. Average days to resolve a complaint decreased in FY 2004 from 108 days to 92 days.

For more information, call the Department of Labor’s toll-free help line at 1-866-4USWAGE (1-866-487-9243). Information is also available on the Internet at www.wagehour.dol.gov. Information about the Overtime Security regulations can be found on the Internet at www.dol.gov/fairpay.

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U.S. Department of Labor releases are accessible on the Internet at www.dol.gov. The information in this news release will be made available in alternate format (large print, Braille, audio tape or disc) from the COAST office upon request. Please specify which news release when placing your request at (202) 693-7828 or TTY (202) 693-7755. The Labor Department is committed to providing America’s employers and employees with easy access to understandable information on how to comply with its laws and regulations. For more information, please visit www.dol.gov/compliance.